‘Farmers aren't death duty dodgers – we can't afford to pay inheritance tax'
In Cumbria, fifth-generation organic dairy farmer, James Robinson, has been racked with worry since Budget day, when Rachel Reeves unveiled
'Whatever they say about protecting family farms, we won't be exempt from the tax, even on a farm of our size – 300 acres,' he says.
The Chancellor's changes to both 'agricultural property relief' and 'business property relief' have lit a fire under rural Britain.
Westminster is on Tuesday ringing with the sound of protest as farmers descend on the capital to make their voices heard.
British farming is already on its knees, and there is anger and confusion about why the new Labour government has decided to single out this beleaguered community.
Robinson is in a partnership with his parents, and is now in the process of working out
Until the day before the Budget, the correct tax advice was to keep the asset until death. But this is no longer viable.
'We emailed our accountant before Rachel Reeves even sat down [on Budget day],' says Robinson. 'What worries me are the unknowns and how things might change again – and I can't see them changing for the better.'
The consequence for the Robinsons is not selling up,
Robinson's son Robert is 20, and since the announcement the family have begun discussing how to get him involved in the partnership. This course of action is essential – the farm could not afford a large tax bill.
'There physically wouldn't be the money in the business,' says Robinson. 'We're not farming because we want to dodge tax, or because we want to have a big investment that we can pass on in land – we have worked tremendously hard for it, with ridiculously long hours.'
'In 20 years' time it'll be me, Robert, and his son or daughter – the knowledge is slowly passed down.'
So, what is the Government trying to do with this policy? Is it maliciously designed to kill the family farm – or does it aim to catch out those who use agricultural land as a tax haven?
If it's the latter, says Tom Bradshaw, president of the National Farmers' Union, 'come out with it, tell us what you want to do [about it], and we will find a solution'.
He met Darren Jones, chief secretary to the Treasury, after the Budget. 'I looked him in the eye and said, 'what is the question you've asked yourself? If you give me the question I can tell you.' But he doesn't know the question.'
If, as is suspected, the Government intends to crack down on those who
In her Budget speech, Reeves said her reforms would 'continue to protect small family farms' and claimed three quarters of estates 'will be unaffected by these changes'.
But farmers are convinced that the Government has got its sums wrong.
Nearly one in five (17pc) of UK farms failed to make a profit in 2022-23, according to the Country Land and Business Association, while 59pc made a profit of less than £50,000.
Simon Gadd is another of the thousands of farmers across the country panicking about what the future holds. He's taken advantage of unseasonably warm November weather to drill winter wheat and beans.
The view across his Lincolnshire fields is idyllic, but Gadd is trying to work out just how his family would be able to
With his father, he runs his family's 400-acre farm near Boston, where the Gadds have farmed since the fens were drained.
The family certainly cannot afford a tax bill of the magnitude that would be created by the new policy – even if land locally sells for an 'unusually cheap' £11,000 an acre.
The answer is likely to be a life insurance policy, or a mortgage, but both incur extra costs. He doesn't understand what Reeves is trying to achieve with this policy: 'She said that none of these taxes would go on to working people.'
But if Gadd – one half of a two-man band, who is not just a farmer but a mechanic, a marketer, a handyman, an electrician, and a father too – isn't a working person, then who is?
Last year, so much of the Gadds farm flooded that they were only able to harvest 60pc of their wheat, and as such did not make a profit.
'This policy change is going to impact almost every single viable farm,' says Joe Evans, vice-president of the Country Land and Business Association (CLA).
'The 7pc [according to the Treasury, the total percentage of claims worth more than £2.5m] is wrong, and we stand by that.'
Modelling done this week by the CLA shows that inheritance tax bills could wipe out farming profits for a decade.
A 200-acre farm with an expected annual profit of £27,300 would face a tax liability of £435,000 – if paid off over a decade, the farm would have to relinquish 159pc of its annual profit to HMRC.
Bradshaw adds that, perhaps, 20 years down the line, 'you could see a place where, potentially, the industry can be more dynamic'.
But the loss in the meantime is likely to be staggering.
'There is a real risk that this will be an absolute disaster for the owner-occupier, 200 to 800-acre farmer. Family farms will be sold if this pervades,' says Evans.
As for food security, he says, 'there will be consequences. What may happen is that bigger, leaner holdings will swallow up the family farms, and some heavily invested food producers may become more efficient. But there is no way that you can cast this as a good thing for the rural economy overall'.
'It is pretty demoralising,' Evans says. 'The implications of this Budget will put further brakes on what is already a struggling part of the economy. It's so sad when so many of us want to do more with it.'
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The implementation period has been doubled to a maximum of four years from royal assent, the point it is rubber stamped into law, rather than the initially suggested two years. If the Bill was to pass later this year that would mean it might not be until 2029, potentially coinciding with the end of this Government's parliament, that assisted dying was being offered. Labour MP Kim Leadbeater, who is the parliamentarian behind the Bill and put forward the extended timeframe, has insisted it is 'a backstop' rather than a target, as she pledged to 'hold the Government's feet to the fire' on implementing legislation should the Bill pass. The extended implementation period was one of a number of changes made since the Bill was first introduced to the Commons back in October. – What other changes have there been? On Friday, MPs bolstered the Bill so people with eating disorders are ruled out of falling into its scope. Another amendment, requiring ministers to report within a year of the Bill passing on how assisted dying could affect palliative care, was also approved by MPs. Previously, a High Court safeguard was dropped, with the oversight of judges in the assisted dying process replaced with expert panels. The change was much criticised by opponents, who said it weakened the Bill, but Ms Leadbeater has argued it strengthens it. At the end of a weeks-long committee process earlier this year to amend the Bill, Ms Leadbeater said rather than removing judges from the process, 'we are adding the expertise and experience of psychiatrists and social workers to provide extra protections in the areas of assessing mental capacity and detecting coercion while retaining judicial oversight'. 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It had 'not been possible' to estimate the overall implementation costs at this stage of the process, it added. While noting that cutting end-of-life care costs 'is not stated as an objective of the policy', the assessment estimated that such costs could be reduced by as much as an estimated £10 million in the first year and almost £60 million after 10 years. – Do healthcare staff have to take part in assisted dying? It was already the case that doctors would not have to take part, but MPs have since voted to insert a new clause into the Bill extending that to anyone. The wording means 'no person', including social care workers and pharmacists, is obliged to take part in assisted dying and can now opt out. Amendments to the Bill were debated on care homes and hospices also being able to opt out but these were not voted on. Ms Leadbeater has previously said there is nothing in the Bill to say they have to, nor is there anything to say they do not have to, adding on the Parliament Matters podcast that this is 'the best position to be in' and that nobody should be 'dictating to hospices what they do and don't do around assisted dying'. – What will happen next? Friday's vote in the Commons makes it more likely for the assisted dying Bill to become law, now that it has the backing of a majority of MPs. But this is not guaranteed, and first it must continue on a journey through Parliament. The Bill now heads to the House of Lords, as both Houses of Parliament must agree its final text before it can be signed into law. During the next stages, peers are expected to put forward amendments to the Bill. If the Commons disagrees with these amendments, this will spark a process known as 'ping pong' which will continue until both Houses agree over its text. – Will the Bill definitely become law? There is a risk that the Bill could be stuck in a deadlock between the House of Commons and House of Lords, as it goes back and forth in disagreement. If this continues until the current session of Parliament ends, then the Bill would fall. Ms Leadbeater told journalists on Friday she hoped there were no attempts to purposefully wreck it by peers. 'I really hope there are no funny games, because the process has been extremely fair,' she said. The Spen Valley MP said she did not know when the current parliamentary session would end, but suggested it could stretch into late 2025, giving her Bill the best part of six months to complete the full parliamentary process. Speaking about the end of the session to reporters, Ms Leadbeater said: 'I am not imagining that is going to be imminently, but it could be before the end of the year.' One member of the House of Lords, Bishop of London Dame Sarah Mullally, has already indicated she is against it. The Church of England bishop said peers 'must oppose' the assisted dying Bill when it reaches them because of the 'mounting evidence that it is unworkable and unsafe'. – What about assisted dying in the rest of the UK and Crown Dependencies? The Isle of Man looks likely to become the first part of the British Isles to legalise assisted dying, after its proposed legislation passed through a final vote of the parliament's upper chamber in March. In what was hailed a 'landmark moment', members of the Scottish Parliament (MSPs) in May voted in favour of the Assisted Dying for Terminally Ill Adults (Scotland) Bill, backing its general principles. It will now go forward for further scrutiny and amendments but will become law only if MSPs approve it in a final vote, which should take place later this year. Any move to legalise assisted dying in Northern Ireland would have to be passed by politicians in the devolved Assembly at Stormont. Jersey's parliament is expected to debate a draft law for an assisted dying service on the island for terminally ill people later this year. With a likely 18-month implementation period if a law is approved, the earliest it could come into effect would be summer 2027.
